Commodities Daily - April 26, 2019

> Oil slides on profit taking after surging to YTD highs amid stronger dollar and stock market weakness; 1Q19 US GDP eyed. Today, investors everywhere will eye the 1Q19 US GDP report and underlying stats. The data published throughout the quarter points to a steady economic performance - and one far better than what was expected just a few months ago. Thus, a strong GDP reading now seems to be the investor consensus. An upbeat reading would boost the prospects for oil demand for this year, while a downbeat reading would amplify the threat of lower oil demand growth this year. However, we think that the upside for oil of a bullish GDP figure is limited, whereas the downside in the event of a bearish outcome is much more significant. We do not expect US GDP to offer any surprises and think that Brent will secure within the $74-75/bbl range later today.> Gold prices brush off recent dollar gains, move higher on global growth concerns; 1Q19 US GDP on the radar. This morning, gold is back to $1,283/oz, which seems to be the result of some "last-minute" pricing in of cautiousness ahead of the US GDP release. If the data comes in upbeat, it will be something of a double whammy for gold: it will likely drive the dollar stronger and, more importantly, it will likely reverse the current cautiousness prevailing in markets, thus increasing the appetite for risk assets. However, if US GDP disappoints, a break above $1,290/oz will almost certainly be in the cards today. This could also open the way for a run to $1,300/oz in the weeks to come. However, we do not expect US GDP to offer any surprises and think that the most likely scenario is a move lower in gold toward $1,270/oz later in the day.